Geojit Investments has issued a bullish "Accumulate" rating on PB Fintech Ltd (PolicyBazaar), signaling confidence in the company's robust growth trajectory and improving profitability metrics. Despite a challenging macro environment, the digital insurance marketplace has demonstrated strong revenue expansion, particularly from online insurance premium growth. With EBITDA turning positive and a sharply rising Profit After Tax (PAT), the stock is poised for a 12% upside from current levels. Investors are advised to accumulate the stock at its current price of Rs 1,921 with an upscale target price of Rs 2,143 based on an FY27 estimated Price-to-Sales multiple of 11.8x.

1. Significant Revenue Surge Bolsters Confidence

PolicyBazaar posted a 33.4% year-over-year revenue increase in Q1 FY26, reaching Rs 1,348 crore. This growth was primarily fueled by a 35% rise in online insurance premiums, with health insurance premiums soaring by 65% YoY. Core online insurance revenues expanded 37% YoY to Rs 732 crore. The company’s broadening footprint in the insurance segment is reflected in total insurance premiums scaling 36% YoY to Rs 6,616 crore, confirming the robust demand for digital insurance solutions.

2. Positive EBITDA and Profit Growth Signal Financial Turnaround

After several quarters of losses, PolicyBazaar’s EBITDA swung positive in Q1 FY26 at Rs 34 crore versus a loss of Rs 39 crore a year ago, translating into a 2.6% EBITDA margin. Despite a 22.9% increase in employee benefits expenditure, the company improved operational efficiency. PAT surged 41.1% YoY to Rs 85 crore, underscoring the company’s ability to convert top-line gains into net profitability. The fiscal trajectory is set to sustain, with FY26 and FY27 EBITDA projected at Rs 575 crore and Rs 1,115 crore respectively, reflecting margins expanding to 8.8% and 13.4%.

3. Customer-Centric Strategies and AI Integration Drive Efficiency

The report emphasizes PolicyBazaar’s elevated customer satisfaction score of 92.1%, revalidated consistently, underscoring superior service delivery. A strategic focus on AI adoption aims to optimize call center operations, facilitating headcount rationalization while enhancing engagement and retention. This technological leverage is expected to underpin cost efficiencies and sustain scalable growth within a highly competitive digital insurance ecosystem.

4. Expanding Business Verticals and Market Reach

PolicyBazaar’s management plans to diversify operations by acquiring and integrating 3-4 new assets, including ventures into hospital ownership, signaling an expansion beyond traditional insurance brokerage services. This multi-asset strategy anticipates vertical integration to complement existing business lines and amplify overall revenue streams. The company’s pan-India presence and channel partner scale position it well to capture new market segments.

5. Upgraded Financial Estimates Reflect Strategic Optimism

Revised projections show sales growing from Rs 4,977 crore in FY25 to Rs 6,570 crore in FY26 (+32%) and further to Rs 8,337 crore in FY27 (+27%). Likewise, adjusted PAT is expected to nearly triple from Rs 394 crore in FY25 to Rs 717 crore in FY26 (82%) and Rs 1,193 crore in FY27 (66%). The EPS trajectory mirrors this growth, rising to Rs 15.6 in FY26 and Rs 26.0 in FY27 from Rs 8.6 in FY25. Valuation multiples anticipate expansion with ROE improving to 14.3% by FY27, supported by negligible debt and a healthy cash reserve.

6. Current Stock Positioning and Price Targets

Investors are encouraged to accumulate the stock amid transient volatility given the company’s clear path to profitability and market leadership in the online insurance sector.

7. Risks and Considerations

The report notes margin sensitivity related to rising employee expenses and seasonal fluctuations impacting quarterly profitability. Additionally, the competitive landscape in digital insurance broking is intensifying, requiring constant innovation and customer acquisition cost management. Regulatory changes impacting insurance products could also introduce uncertainties. However, PolicyBazaar’s diversified product portfolio and strong partner ecosystem are mitigating these risks.

8. A Balanced Buy Opportunity

Geojit's research underscores PolicyBazaar as a compelling mid-cap stock with a favorable earnings growth trajectory, improving margins, and a strong customer base. The infusion of AI and comprehensive asset expansion plans signal future-proofing against evolving market dynamics. With a 12-month target price suggesting a moderate upside, the "Accumulate" rating advocates for a measured build-up of exposure for investors seeking long-term capital appreciation in India’s burgeoning digital insurance market.

In essence, PolicyBazaar is transitioning from a growth-heavy phase to an era of profitable scale, making it a noteworthy contender for diversified portfolios with an appetite for mid-cap technology-enabled financial services companies.